Bad Credit Loans That Help

It's never easy when you're trying to get a loan but you don't have a good credit score. Lenders may choose to deny your application outright, or they may only approve it with very poor terms for you. The good news is that Miami title loans are available for borrowers with bad credit, and the application process is quick and easy. Here's what you need to know about this type of loan and why it's so good for bad credit borrowers.

Why Car Title Loans Are Ideal When You Have Bad Credit

The main reason why title loans are one of the best options when you have bad credit is because the application process doesn't involve any sort of credit check. If you were to get a loan through a bank, credit union or most other lenders, they would run a hard credit check to see your credit score and history.

Not only could these lenders potentially deny you because of items in your credit report, but that hard inquiry they run also brings your credit score down a bit, making a bad credit score even worse.

A vehicle title loan is much different. The loan is only contingent on your car and the value of that car. The lender never sees your credit and in most states, they don't even need information on your income.

The Only Requirements to Obtain a Title Loan

So, if there's no credit check involved, what do you need to obtain a car title loan? If you're going to a title loans location in Florida, here are the three things you'll need:

• Identification (any form of government-issued ID, such as a passport or driver's license, will do)
• Your car
• Your car's title

As it's the car's value that you're using to get your loan, the car will also be the collateral on the loan. This means that the lender could repossess it if you default on the loan, but this is a rare occurrence since title loans have flexible repayment terms. But it also means that the car must be yours alone and fully paid off. Your name needs to be on the title, and there can't be a lienholder listed.

Note that despite your car being the collateral, you'll still have it as you repay your loan. The lender will only keep the title to the car in a secure location. Once you're done paying back your loan, the lender will return the title.

The title loan application process typically doesn't even take an hour. Here's how it works:

1. You go to the title loan company's office and sign the loan contract.
2. The lender evaluates your car and uses a value guide to determine the current market value on it.
3. The lender figures out the most they're able to lend you from that market value.
4. You give the lender your car's title and get your title loan in return.

Improving a Bad Credit Score

Although a title loan can be convenient, it's always smart to work on your credit score, because it will come up a lot in life. And when you have a good credit score, you'll have far more loan options available when you need them.

When you have a bad credit score, improving it can seem like a difficult task, but it really isn't if you get into the right financial habits.

The first thing you should do is check your credit reports. You get to do this for free once per year through the major credit reporting agencies, which are Equifax, Experian and TransUnion. If you notice any mistakes, you should notify both the agency that reported the mistake and the creditor behind the mistake immediately to avoid having them drag down your score.

Next up, start paying all your bills on time if you haven't been doing that already. Payment history is the single most significant factor that credit agencies use when they calculate a score for you, and just going from a bad payment history to paying on time consistently can raise your score quite a bit.

If you have high balances on your credit cards, work on paying them down. Make it your goal to keep your credit utilization under 30 percent. Credit utilization is simply the sum of all your balances compared to the sum of all your credit limits across every credit card you have.

Those are the three main things you should do for your credit score to start. They aren't the only factors that affect your score, but they are the most important, which is why you should handle them first.

Getting a Title Loan in Times of Need

It's best to have the options a good credit score provides, but when you're short on time, title loans can be a big help. Make sure you pay the loan back on time, and you'll be off to a good start with improving your credit.